Chancellor George Osborne is believed to want to scrap the 50p rate of tax in his 2013 Budget following claims that it does not make money for the Exchequer.
Although a review is just about to start into how much the higher rate – which came into force in April last year – generates, the Daily Telegraph believes that 2013 had been pencilled in as the best case scenario for the tax to be lowered.
In his Budget last month, Osborne claimed that higher personal tax rates "crush enterprise, undermine aspiration and often undermine tax revenues as people avoid them", but would not be drawn at the time as to when he intended to lower them.
The Treasury said that its position had not changed and that any future moves to alter the 50p tax rate would be determined by the review and only announced in a future Budget.
But the Telegraph said "after three years of straightened economic times and little to cheer Tory voters, Mr Osborne will, by 2013, be desperate to break free from the deficit reduction straight-jacket that has limited any moves they could make to cut taxes".
Some senior Tories are also adamant that cutting the rate would raise money for the Exchequer. Lord Lawson, who as Conservative Chancellor cut the tax rate to 40 pence in 1988, said after Osborne announced the review during his Budget speech: "I hope it will be a signal that he will bring it down next year. The 50 pence rate does not bring in any revenue at all."
